Hong Kong’s TSL Expects Full-Year Loss

RAPAPORT... Tse Sui Luen (TSL) has warned it will report a loss for the fiscal year, with sales hampered by a sluggish retail environment in greater China.

The Hong Kong-based jeweler expects a loss of at least HKD 80 million ($10.3 million) for the year ending March 31, it said last week. That compares with a profit of HKD 54 million ($7 million) the previous year. The company based the projection on its performance during the first 11 months of the fiscal year.

The slowdown, which began in July, is the result of a number of factors including the US-China trade war and prolonged social unrest in Hong Kong, TSL said. The COVID-19 outbreak has also impacted sales.

“The coronavirus outbreak in January 2020 has taken a heavy toll on the retail industry, dealing a severe blow to the Hong Kong and mainland China economies,” the company noted. “The group’s turnover was [affected] further by the weakest overall sales in February 2020, the traditional peak season of the retail industry…which is expected to drop by approximately 88% year on year.”

In an effort to cut costs, TSL has negotiated rent reductions with landlords, and plans to close some of its stores, it added.